2021 (1) TMI 1013 - HC - GST

Provisional attachment of Bank Accounts - no notice under Sections 73 74 of the CGST Act has been issued to the petitioner as yet - Section 83 of the Central Goods and Service Tax Act, 2017 - HELD THAT - This writ petition is disposed off directing the respondents to, on or before 29th January, 2021, issue instructions to the banks aforesaid, of lapsing of the attachment earlier affected and impugned in this petition. However if there is any other order of attachment of the same bank accounts, the same be served on the petitioner, through the counsel, on or before 29th January, 2021. It is clarified that even if the respondents, on or before 29th January, 2021 do not issue the instructions as aforesaid to the banks or do not serve on the petitioner through advocate any other order attaching the said bank accounts, the attachment effected on 9th January, 2020 of accounts shall stand quashed and the banks shall allow the petitioner to, after 29th January, 2021, operate the accounts - petition disposed off.

Summary

Issues:
1. Provisional attachment under Section 83 of the Central Goods and Service Tax Act, 2017 (CGST Act) of the petitioner's bank accounts.
2. Lapsing of the attachment and issuance of instructions to the banks.
3. Disposal of the writ petition and preservation of respondents' rights.

Analysis:

1. The petitioner challenged the provisional attachment of their bank accounts under Section 83 of the CGST Act. The attachment was made on 9th January, 2020, and the period for which the attachment could operate had expired on 8th January, 2021. The petitioner argued that the attachment had lapsed, and the respondents were obligated under Section 83(2) to instruct the banks about the lapsing of the attachment.

2. The respondents did not contest the lapse of the attachment and confirmed that no notice under Sections 73 & 74 of the CGST Act had been issued to the petitioner. The respondents proposed the disposal of the petition by directing the de-freezing of the attachment while preserving their rights. The court directed the respondents to issue instructions to the banks about the lapsing of the attachment by 29th January, 2021. Any other order of attachment, if existing, was to be served on the petitioner through their counsel by the same date.

3. The petitioner contended that the respondents had no legal basis to continue the attachment under any other provision of the law. The court clarified that the petition did not involve adjudication on other attachments of the bank accounts. It was emphasized that the attachment challenged in the petition had indeed lapsed. Consequently, the court disposed of the petition, ordering the respondents to quash the attachment and allow the petitioner to operate their bank accounts after 29th January, 2021, if no further instructions or orders were issued by that date.

This judgment primarily addressed the lapsing of a provisional attachment under the CGST Act, ensuring the petitioner's right to operate their bank accounts after the expiration of the attachment period. The court's decision focused on the specific attachment challenged in the petition, directing the respondents to take necessary actions regarding the lapsing of the attachment and clarifying the consequences if no further orders were issued by a specified date.